Mitsui Sumitomo Bank and 8 Other Companies Complete DvP Settlement Demonstration for ST Secondary Transactions

Mitsui Sumitomo Bank, Daiwa Securities, SBI Securities, SBI VC Trade, and a total of 9 companies announced on October 6 that they have completed phases 1 and 2 of the demonstration project "Project Trinity," which utilizes stablecoins (electronic payment methods) for DvP (Delivery versus Payment) settlements in the secondary market for security tokens (ST).

The participating companies also include SBI R3 Japan, Osaka Digital Exchange, BOOSTRY, Progmat, and Datachain. They have confirmed the feasibility of T+2/DvP settlements between securities companies to a certain extent from legal, technical, and operational perspectives.

Principal Risk of Partial Fulfillment Remains a Challenge

DvP refers to a settlement method where the delivery of securities and the payment of funds occur simultaneously. In the current ST secondary market, these two actions do not necessarily happen at the same time, creating a risk (principal risk) where one side may not be fulfilled, which has been a structural challenge hindering the expansion of large transactions.

With the revised Payment Services Act enacted in 2023, the issuance of stablecoins (electronic payment methods) linked to legal currency has become possible. Relevant parties have focused on the immediate value transfer function of stablecoins and have been advancing the verification of DvP settlements that simultaneously deliver STs and pay with stablecoins. This project aims to structurally eliminate principal risk and enhance settlement efficiency.

Phase 2 Demonstration Scheme and Results

In Phase 2 (April to September 2026), operational verification using actual issued STs and stablecoins was conducted. Using the "self-private placement ST corporate bond" issued by SBI VC Trade, two self-ST transfer transactions were executed between SBI Securities and Daiwa Securities, assuming transactions on the START market operated by Osaka Digital Exchange. The third electronic payment method (specific trust beneficiary-type stablecoin) issued by Mitsui Sumitomo Bank was used as the settlement method.

Progmat managed the ST infrastructure and bond ledger, while cross-chain technology spanning different blockchains was jointly provided by Progmat and Datachain. The foundation for the stablecoin was provided by Mitsui Sumitomo Bank in cooperation with TISI and Fireblocks. Within the scenarios and timelines set for verification, results were confirmed as expected.

On the other hand, for full-scale operations involving multiple ST infrastructures and payment methods, challenges remain in establishing a stable operational framework within the payment deadlines and enhancing business applications. The eight companies involved, excluding SBI VC Trade, are considering future responses while monitoring trends in regulatory and market infrastructure developments and the evolution of digital currencies suitable for inter-company settlements.

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